I want to return to the 1974 Act. I am conscious that the Government have already reached a decision in this respectthey have decided that they want the offence of corporate manslaughterand I suppose that my hon. Friends and I will do our best to help them now 10 Oct 2006 : Column 214
that they have done so. However, my own instincts, including a desire to see rigorous application of health and safety in all spheres, make me wonder whether we have not made a mistake. In the 1974 Act, Lord Robens did this country a signal good service. It is a very well crafted piece of legislation. I have never heard it criticised except sometimes in relation to subsidiary regulations accused of being too onerous. The nub of the legislation itself has stood the test of time extremely well. The thing that it does, which the Bill does not do, is to simplify the law in terms of the duties of care owed by employers to their own employees and to those who might be affected by their undertakings in such a way that over the 30-year period of its operation there has been a series of important judgments whereby every weasel argument that employers can put forward to try to justify getting themselves off the hookfor example, passing the buck to subcontractorshas been completely and utterly eliminated.

The 1974 Act is one of the most powerful and effective regulatory tools put on to the statute book by Government. Far from being limp in its impact, we can see that in recent years the fines imposed for serious accidents and deathunlimited in the Crown courthave risen stratospherically. The Home Secretary spoke of £7.5 million in relation to the Hatfield rail crash, but even for accidents that may not result from quite such a major disaster, large fines against corporationshundreds of thousands of pounds for single deaths or even sometimes for the creation of riskare routine. There is every sign that that trend is continuing upwards as a result of societal pressure to mark disapproval of those whose safety systems are inadequate.

Mr. Clapham:
In 2004, when there were just over 200 fatalities in industrythis past year, the figure is similar at 212fines were just £43,000. The average fine was just over £3,000. I agree with the hon. Gentleman that the instrument of the 1974 Act has helped to get to grips with problems in the workplace. Nevertheless, the fines that are imposed under that Act are so small that they do not deter employers at all. I should like the Home Secretary to bear that in mind.

Mr. Grieve:
I am not certain that I agree. The difficulty is that if a large corporation such as a Tesco or a Sainsburys kills an employee, a fine of millions of pounds may make little dent on its balance sheet. One of the problems that we have to face up to is that many of those prosecuted under the 1974 Act are individuals with very limited means. If a fine of £2 million is imposed because it marks the gravity of the offence, it will never be collected because there is nowhere near that amount to be collected. It is true that the company, in the case of a corporation, will be put out of businessindeed, there is authority in the Court of Appeal that says that in some cases that may be a very good thing to dobut unless that is the intention, the size of the fine becomes rather meaningless.

Let me say to the Home Secretary, because it is important that the public should understand this, that I am very doubtful that, having introduced the new concept of corporate manslaughter, the fines imposed will be very different. I can see that in the case of major 10 Oct 2006 : Column 215
corporations it may be possible to impose a much higher fine and to say, We are moving into the £20 million or £30 million range because as you are a multi-billion pound corporation we want to hurt you in your pocket. I, for one, have no difficulty with that. In many cases, however, as I am sure that the Home Secretary has been told, the companies prosecuted will be cowboy operators, individuals with very limited resources and companies whose only assets are, in effect, their annual turnover and profit. In those circumstances, courts will not impose multi-million pound fines, because they will be shownas they are under the terms of the 1974 Actbalance sheets and the accounts of the company, and if they decide not to put it out of business, they will have to impose a fine that is commensurate with its ability to pay it. As has often been argued, in the case of public authorities the money that is levied as a fine takes from them the very money to carry out the necessary improvements to meet the standard that they should have delivered from the start.

I have a question mark in my mind as to whether in reality we will find ourselves moving into a different fine regime. The danger is that we will end up with people who, having had their expectations raised, find themselves left with a feeling of distress and disappointment that the horror of what has happened to a near relative has not been responded to. I see no easy way out of that and therefore wonder whether we are not, in enacting this legislation, making unnecessary difficulties for ourselves. I endorse the point made before the Joint Committeethat we should have, under sections 2 and 3 of the 1974 Act, a separate aggravated offence of an act by which death results. There would then be some sentencing guidelines emphasising that much higher fines should be imposed in those circumstances, and we could see whether that works.

However well-intentioned the Bill, the fact remains that conviction rates in prosecutions under the 1974 Act are some of the highest in any field of criminal justiceconsistently more than 80 per cent. and in some cases closer to 90 per cent. in any 12-month period. That is because it is so drafted and interpreted that it imposes an arm-twist on any defendant from which they will have great difficulty in escaping. It worries me that, in contrast, this Bill seems very complicated. Having declared my interest at the outset, I cannot help wondering whether we are about to create another lawyers bonanza.

There is a risk, given the complexity of the issues of duty and care and breachand the fact that corporations might be more reluctant to plead guilty because of the opprobrium attached to a manslaughter convictionthat we might end up with far more contested cases. Under health and safety at work legislation, a contested case relating to a major disaster can last for many weeks and cost a lot of money. It is true that that money can usually be recouped from the defendant, unlike in most criminal justice cases; even so, we ought to bear in mind such factors.

Having said that, I am mindful that the Home Secretary has probably made up his mind on that point, but I shall nevertheless seek to explore it in 10 Oct 2006 : Column 216
Committee. At the end of the day, we should be concerned not about the words but about the results. Our aim should be to enact legislation that changes the attitudes of those who might be negligent, hits them selectively and properly in their pockets to encourage them to act with care, and produces a better sense of public justice. However, those three aims need to be kept in the balance, and the test of the Bills success will not be what we say in the House, but whether it achieves those results.

Several hon. Members rose

Madam Deputy Speaker (Sylvia Heal):
Order. Many Members wish to contribute to the debate, so I must ask them to exercise self-discipline and to make their remarks brief so that more Members may make a speech. I am thinking in particular of Back Benchers.

6.41 pm

Mr. Andrew Dismore (Hendon) (Lab):
Before I came to the House, I was a personal injury lawyer. Indeed, I suppose that I still am, although I no longer take any cases. I refer hon. Members to my entry in the Register of Members Interests.

As a personal injury lawyer, I represented many families bereaved by avoidable accidents, including major incidents such as Zeebrugge and the Kings Cross fire. Most of the cases, however, involved the deaths of individuals such as motorists, employees and pedestrians, which went unremarked in the press. But the feeling of loss and sense of injustice suffered by the victims families were the same as the feeling of loss and sense of injustice suffered by those bereaved by the major incidents.

Three days after the terrible tragedy at Kings Cross, my investigations on behalf of the bereaved and injured led me to inspect what was left of the tube station. Nothing that I had previously experienced could have prepared me for the sights and smells of the fires devastation that I encountered there. As I took statements from victims, distraught relatives, firefighters and tube staff, and as I sat through the public inquiry day after day, hearing over and again about the failures of the management of London Underground Ltd, it struck me as outrageous that neither the company nor any of its managers would face criminal proceedings over those 31 unnecessary deaths.

That was because of the inadequacies of the criminal law, and since then I have been campaigning to rectify those inadequacies. The Bill intends to correct them, 20 years after the horrors of Zeebrugge and Kings Cross, 10 years after the royal commissions recommendations for change, and six years after my own private Members Bill. While I naturally prefer the wording of my own Bill, which was simple and effective, I believe that, despite containing shortcomings on which we shall have to focus, this Bill makes some progress towards achieving our aims.

I have long believed that we need a new law based on three principles. First, when the conduct of a companys management falling far below what can reasonably be expected is the causeor one of the causesof a persons death, that company must 10 Oct 2006 : Column 217
answer to the criminal courts. Secondly, if the company is convicted, the court should not only be able to punish it severely, but have the power to order it to put right the failings that caused the death. Thirdly, and perhaps most important, there is a need to impose on the senior management of a company an overarching responsibility for the health and safety of its work force and, equally important, of the general public.

The Joint Committee on Human Rights, which I chair, reported on the Bill today. There is a clear obligation under article 2 of the European convention on human rights to secure the right to life by putting in place effective criminal provisions to deter the commission of offences against the person, backed by appropriate law enforcement. In certain circumstances, this obligation requires the state to ensure that recourse to the criminal law is possible against both private and public bodies in serious cases of unintentional deaths.

In the Committees view, there is a clear obligation under article 2 to introduce an offence of corporate manslaughter that would enable recourse to the criminal law against both private and public bodies in circumstances in which that is not possible under the present law, where such recourse would be required under article 2. The Committee therefore welcomes the objective of the Bill as a human rights-enhancing purpose. For me, however, the acid test will be whether it will be easier to prosecute. Thinking back to the disasters of the 1980s and subsequently, would prosecutions that failed at the timeor that were never even broughthave succeeded if these provisions had been available?

I am worried that the original, broader, definitionused, for example, in the 2000 consultationthat referred to undertakings has been removed so as to exclude unincorporated associations. It is suggested that small businesses in this categoryagainst which prosecutions have succeeded under the existing law, which is being abolished by the Billwould see cases brought against a named trader alone, and that large partnerships such as accountants and lawyers are low risks. The hon. Member for Beaconsfield (Mr. Grieve) gave a good example in relation to Lloyds. But what of architects, for examplewho often practise in partnershipswho design a building that collapses, or is gutted by fire, due to grossly negligent design? Schools, clubs and even trade unions are outside the current scope of the Bill.

The Joint Committee on Human Rights considered whether these various restrictions on the scope of the new offence were incompatible with the right not to be discriminated against in the enjoyment of convention rights under article 14 of the European convention, in conjunction with the right to life in article 2. In my Committees view, article 14 is engaged because the various restrictions, exclusions and exemptions give rise to differential treatment of individuals in analogous situations in relation to their access to the criminal law in respect of negligently caused death.

The Committee noted that, in the 2000 consultation paper, the Government accepted that to restrict the scope of the offence by excluding unincorporated bodies

could lead to an inconsistency of approach and these distinctions might appear arbitrary.

10 Oct 2006 : Column 218

To avoid that risk of arbitrariness, the Government at that stage proposed that the new offence should apply to undertakings, which would include unincorporated as well as incorporated bodies. In the case law of the European Court of Human Rights, the public nature of a bodys function has not been regarded as a reason for excluding criminal liability, but on the contrary has been treated as a factor which strengthens the obligation to ensure that recourse to the criminal law is available. The obvious answer is to revert to the original proposal to apply the new offence to undertakings.

I very much welcome the extension of the Bill to apply to the Crown, as does the Human Rights Committee. However, my Committee considers that the restrictions, exemptions and exclusions in the Bill will preclude the possibility of prosecution for corporate manslaughter in precisely those contexts in which the positive obligation in article 2 is at its strongest, and in which a criminal prosecution should be brought: the use of lethal force by the police or army; deaths in custody; and deaths of vulnerable children who should be in careto name just a few examples. This would mean that, in situations in which responsibility for the death lay with a management failure in a public body, rather than with any identifiable individual, recourse to the criminal law would not be possible.

In a sufficiently serious case, that would be likely to lead to the United Kingdom being found to be in breach of its positive obligation under article 2 to put in place an effective system of judicial remedies, including, in certain circumstances, recourse to the criminal law. In particular, this would apply to deaths in custody. It is not enough to say that there are extensive provisions to investigate these deaths already. So there are, too, for transport accidents, chemical plant explosions or the humble factory death. Individual prosecutions are not the answer either. There is no logical reason to exclude institutional operational failures, which may lead to a death in custody, from the provisions of the Bill.

In our report, the Committee gives an example to demonstrate this point. The Metropolitan Police Commissioner is currently being prosecuted under the Health and Safety at Work, etc. Act 1974 in respect of the shooting of Jean Charles de Menezes. If the Bill becomes law unamended, and if, hypothetically, there were clear evidence that a similar shooting was the result of gross negligence on the part of the senior management of the Metropolitan police, but was not attributable to one individual officer who could be described as the controlling mind of the organisation, it would not be possible for the Metropolitan police as a public authority to be prosecuted in respect of the death. It would still only be possible to bring proceedings against the Metropolitan police as a public authority under health and safety legislation, as now, for a much less serious offence. In such circumstances, there would be a strong likelihood that the United Kingdom would be found to be in breach of the positive obligation in article 2, because the criminal offences charged did not reflect the seriousness of the conduct which led to the death, and the judicial system in place was not adequate to secure the full accountability of state authorities for their role in the death.

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Mrs. Joan Humble (Blackpool, North and Fleetwood) (Lab):
Have my hon. Friend and his Committee had an opportunity to consider the Bills impact on the armed forces, in relation to which there is a series of wide-ranging exclusions? As I am sure he is aware, there have been several deaths in Army barracks in peacetime which have not been properly investigated by the police. Coroners courts have recorded open verdicts and expressed concern over the operation of the Army in the matter.

Mr. Dismore:
My hon. Friend is absolutely right, and the report touched on the issue. It is interesting to note that, while training is included, operational activities are not. That applies particularly to the emergency services. When I was in practice, I used to act on behalf of the Fire Brigades Union. A number of deaths were caused by serious management failures on the part of the fire service. As currently configured, the Bill would not include such management failure either.

I am concerned about the breadth of the general exclusion for public functions in relation to statutory inspections. Such inspections constitute a public safeguard against death and injury. Quis custodiet ipsos custodes? That requires clarification in the Bill. As I have said, I am pleased that the Government have provided some clarification in regard to emergency services, but it does not go far enough.

In relation to management failure, I believe that the Government have created a significant loophole by tying the offence to the actions of senior managers. While the comments of Mr. Justice Sheen in the Zeebrugge ferry disaster inquiry castigated the management throughoutwhich might just have meant a successful prosecution under the BillI am not sure whether the test would have worked at Kings Cross, for example, where the failures were further down the food chain, but institutional in the organisation of London Underground.

I believe that, in having to focus on the behaviour of senior managers, prosecutors will face disadvantages similar to those that they face under existing law, looking for individuals failuresalbeit possibly aggregatedrather than corporate responsibility as a whole. The test would exclude prosecutions in cases in which death occurred in a discrete part of a business, geographically or sectorally. What of a large building site, one of many owned by a large developer, run by a major construction contractor? The person in charge of the site has a large say in how it is run, but may be a very small fish in a large multinational operations pond which sets the parameters within which he works, especially through finance and the deadlines required by the contract. The Government have indicated that the test will be reconsidered, but I believe that under the Bill as currently drafted, inadequate management practices and systems will escapeespecially in large companiesexactly as they do under the existing laws.

The proposed remedial order power is very welcome, but I believe that it would be better backed up by a contempt of court power, like any other order of the courts. That would overcome the argument over whether the sanction for not complying with a remedial order was correct. But I think that we need to consider more imaginative penalties, too. As has been said, the sanction available is the same as exists under health and 10 Oct 2006 : Column 220
safety law. It is difficult to imagine that finescurrently multimillion-pound fines, in some caseswill be much higher, so it must be asked whether the Bill adds value to the existing position. I believe that the Government are right to say that they will consider more innovative sanctions in the light of the wider review of penalties for regulatory offences.

The Government have suggested that existing legislation allows the disqualification of directors if they have been convicted on indictment, but that response overlooks the fact that they cannot be so convicted, as there is no individual liability under the Bill. The opportunity must be taken to introduce a wider, more innovative range of penalties that are likely to provide a better deterrent to poor health and safety practices, and to deliver justice more effectively to bereaved families.

Mr. Grieve:
Does the hon. Gentleman agree that another possible consequence of the Bill is that it will depress fines imposed for deaths that are only prosecuted under the Health and Safety at Work, etc. Act? Might that not be an unintended consequence of the new framework?

Mr. Dismore:
The hon. Gentleman makes an important point. He also made an important point about the possibility that one prosecution would fail where another might succeed. Ultimately, however, the decision must be for the Crown Prosecution Service and the Director of Public Prosecutions, who must authorise prosecutions.

What is important is for us to look at a wider range of alternatives. A series of suggestions have been made. One is corporate probation, a supervision order imposed by the court on a company that has committed a criminal offence. A court can require a company, its officers or its directors to alter their conduct in a particular way. Those penalties have been used very successfully in, for example, the United States and Canada. Another option is the use of equity fines. They would reduce the value of shares in the company, clearly bringing home to shareholdersthe owners of the companythe implications and effect of the criminal offence that their company had committed.

I think that the Bills main shortcoming is the lack of individual liability. In my view, that is one of the essential requirements of a successful reform of the law such as I proposed in my Bill. Since 2003, the Government have ruled out individual directors liability in criminal law, which I consider to be a tragic mistake. The strongest incentive for an individual director would be that he could stand in place of his company in the dock as a result of its failings, leading to the deaths of employees or members of the public. If company directors can face individual liability for offences committed by their companies under the Companies Act 1989, or frauds committed by their companies, it is so much more right that they should face prosecution if those companies kill.